Coping with the cyber world

Globalisation had turned the world into a village, but without disrupting the physical borders of nation states. However, what is happening now, as the world is on the threshold of cyberspace, is something that is likely to greatly dilute the physical borders separating nations in economic terms without perhaps lessening the socio-cultural differences in terms of nationalities, sub-nationalities, ethnicity, language and race. A cyber-world is in the offing where connectivity is turning citizens into netizens.

Signs are looming large of decisive competitive advantages in the global economy stemming less from low-cost production and much more from the ability to innovate, robotise, and digitalise.

Artificial intelligence, autonomous vehicles, and the Internet of Things are changing the way we live, work and manage economies of nation states. Those who keep a close watch on these futuristic trends are predicting that these new technologies will affect many industries in the decades to come and accord unprecedented importance to the digital world. In this digital world, they assert, globalisation won’t disappear; it will deepen.

If in the past global integration grew as trade barriers came down, it will now rely on the connectivity of national digital and virtual systems and the related flow of ideas and services. This is the core of Globalization 4.0, asserts Klaus Schwab, founder and Executive Chairman, World Economic Forum in his article “Globalisation 4.0 – A new architecture for the fourth industrial revolution”, which appeared in a US magazine, Foreign Affairs, on January 16, 2019.

In this new environment, the world is said to have become a company’s oyster. Illustrating the concept Klaus points to the US-based tech giants: in less than 25 years, Amazon grew from a startup e-commerce store to the world’s second-largest traded company, revolutionising retail, cloud computing, and other Web services; Apple became the world’s first trillion-dollar company in 2018, barely a decade after it released the first iPhone.

Further, he pointed out that planes and cars took more than six decades each to reach 50 million users while computers and mobile phones managed the feat in 14 and 12 years, respectively. At the latest count, four companies, it is estimated, count a billion users or more: Three American ones (Alphabet, Facebook, and Microsoft) and a Chinese one (Tencent). The market power these companies have garnered along the way is said to be awesome.

Artificial intelligence, big data, and the ability to build mass-use tech platforms, Klaus said are starting to determine even national power. So, that is where we in Pakistan need to do some extra focusing. The fact of the matter is we are way behind in this race to enter cyberspace. If we don’t take the right steps and that too urgently, we are likely to be abandoned on the way-side which in turn would even raise questions about our nationhood.

Even in Bangladesh, the Philippines, and Vietnam, advanced industrial robots are replacing skilled human workers in sewing and other trades.

Making matters worse, digitisation has opened the floodgates to information and disinformation alike. Algorithms, not humans, is now said to determine much of what we see and read. Disinformation campaigns, Klaus rightly points out, distorted recent elections in the West, and similar things are happening around the world. As a result, he claims citizens’ trust in their government leaders, their judiciaries, and the media is at or near an all-time low.

According to Klaus, artificial intelligence, for its part, can do as much harm as good and requires careful regulation. As the United States, China, and other states vie for leadership in the field-and in other technologies, such as gene editing-they are being asked by Klaus to agree on what is and isn’t allowed. The same applies, he says, to financial systems. Cryptocurrencies such as Bitcoin have already proven their advantages over traditional money, but they are not immune to exploitation by speculators and criminals. Going forward, central bankers and policymakers are being advised to agree on how to optimize the system’s blockchain backbone so that it can benefit everyone.

In doing so, Klaus advices leaders to accept that we now live in a multipolar world in which several countries and regions will need to share the burden and the bounty of global leadership.

Finally, Klaus asserts that the world must come to terms with the sharing and platform economies. So far, these technological developments have benefited the end-users and, above all, the platforms’ owners. Most platforms are concentrated in a few global hubs, and their advantages have accrued mostly to a small group of early, risk-seeking investors. Because these platforms rely on fewer employees and cut out middleman companies, they are said to have hurt national treasuries and many existing businesses. To meet this challenge and counter the side effects of this incoming awesome change, international agreements, Klaus insists, need to lay out new methods of taxation. Rather than taxing labour, which could handicap already precarious forms of employment, governments need to agree to tax platform activities “at source”-namely-where users are based. That way, governments around the world could benefit, and fund the education and reskilling of their people.

In Pakistan, we need to set up a cell of highly skilled cyberspace experts to do the needed innovations and create our own indigenous systems to benefit from the changes taking place in the cyberspace and that too in time so as to be able to remain in the race.

In the opinion of Klaus what, however, is needed to be done at the global level and urgently as well so that every nation state benefits from the changes taking place at a speed that the world has ever experienced is a unified policy action at the global level. He points out that in the second half of the twentieth century, leaders from all sectors of society laid the institutional foundations for sustained peace, security, and prosperity. The incoming cyber-world, however, seems radically to change this paradigm. Therefore, a new approach is now called for, one that shapes our global future through a sustained commitment to improving the state of the world. The choice is said to be that the leaders could debate whether they should work for the good of their country, or that of humanity. But this much is clear says Klaus: Globalization 4.0 will only accelerate from here. We must do what we can to harness it for good and for all.